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FEDERAL COURT OF AUSTRALIA McHugh v Australian Jockey Club Limited (No 13) [2012] FCA 1441 Citation: McHugh v Australian Jockey Club Limited (No 13) [2012] FCA 1441 Parties: BRUCE MCHUGH v AUSTRALIAN JOCKEY CLUB LIMITED, VICTORIA RACING CLUB LIMITED, AUSTRALIAN RACING BOARD LIMITED, THOROUGHBRED BREEDERS AUSTRALIA LIMITED and AUSTRALIAN TURF CLUB LIMITED File number: NSD 1187 of 2009 Judge: ROBERTSON J Date of judgment: 19 December 2012 Catchwords: COMPETITION – s 45 of the Competition and Consumer Act 2010 (Cth) – thoroughbred horses – Australian Stud Book – thoroughbred horse racing – artificial insemination – restricting or prohibiting the entry in the Australian Stud Book of thoroughbred horses bred by artificial insemination – restricting or prohibiting the entry into races of thoroughbred horses bred by artificial insemination – whether contract, arrangement or understanding – aggregation of provisions – whether provisions have or likely to have effect of substantially lessening competition in a market – thoroughbred breeding market – thoroughbred acquisition market – scope of market – whether thoroughbreds bred by natural cover or by artificial insemination sufficiently close substitutes – appropriate counterfactual – rules of sport TRADE AND COMMERCE – restraint of trade – reasonableness of restraint when imposed – relevance of later events – whether later events foreseeable Legislation: Competition and Consumer Act 2010 (Cth) s 45 Evidence Act 1995 (Cth) ss 81, 128 Racing Act 1958 (Vic) Racing Act 1999 (ACT) s 92 Racing Act 2002 (Qld) ss 91, 79 Racing and Betting Act 1983 (NT) ss 23, 42, 44 Racing and Wagering Western Australia Act 2003 (WA) s 45 Racing (Proprietary Business Licensing) Act 2000 (SA) s 25 - 2 - Racing Regulation Act 2004 (Tas) ss 11, 111 Thoroughbred Racing Act 1996 (NSW) ss 4, 13, 14, 42 Cases cited: Adamson v New South Wales Rugby League Ltd (1991) 31 FCR 242 followed Aerial Taxi Cabs Co-operative Society Ltd (t/as Canberra Cabs) v Lee (2000) 102 FCR 125 referred to Ansett Transport Industries (Operations) Pty Ltd v Commonwealth (1977) 139 CLR 54 followed ASX Operations Pty Ltd and Another v Pont Data Australia Pty Ltd (No 1) (1990) 27 FCR 460 followed Australian Competition and Consumer Commission v CC (New South Wales) Pty Ltd) (1999) 92 FCR 375 followed Australian Competition and Consumer Commission v Channel Seven Brisbane Pty Ltd (2009) 239 CLR 305 referred to Australian Competition and Consumer Commission v IPM Operation and Maintenance Loy Yang Pty Ltd (2006) 157 FCR 162 referred to Australian Competition and Consumer Commission v Leahy Petroleum Pty Ltd (2007) 160 FCR 321 followed Australian Competition and Consumer Commission v Metcash Trading Ltd (2011) 198 FCR 297 cited Buckley v Tutty (1971) 125 CLR 353 considered Commonwealth Aluminium Corp Ltd v Attorney-General [1976] Qd R 231 referred to Dandy Power Equipment Pty Ltd v Mercury Marine Pty Ltd (1982) 64 FLR 238 followed Director-General of Education v Suttling (1987) 162 CLR 427 referred to Geraghty v Minter (1979) 142 CLR 177 followed Integrated Computer Services Pty Ltd v Digital Equipment Corporation (Australia) Pty Ltd (unreported, New South Wales Court of Appeal, 23 December 1988) referred to Lithgow City Council v Jackson (2011) 244 CLR 352 applied Meyers v Casey (1913) 17 CLR 90 applied Lindner v Murdoch’s Garage (1950) 83 CLR 628 followed New South Wales Thoroughbred Racing Board v Waterhouse (2003) 56 NSWLR 691 referred to News Limited v Australian Rugby Football League Ltd (1996) 64 FCR 410 cited Peters (WA) Ltd v Petersville Ltd (2001) 205 CLR 126 followed Raguz v Sullivan (2000) 50 NSWLR 236 applied Re Media Council (No. 2) (1987) 88 FLR 1 cited Re Queensland Co-operative Milling Association Ltd; Re Defiance Holdings Ltd (1976) 25 FLR 169 followed Top Performance Motors Pty Ltd v Ira Berk (Qld) Pty Ltd - 3 - (1975) 24 FLR 268 followed Nevele R Stud v The New Zealand Trotting Conference (High Court of New Zealand, unreported, 26 April 1982) cited New Zealand Trotting Conference v Nevele R Stud Ltd (CA 82/82, 10 December 1982) cited Clarke v Earl of Dunraven & Mount-Earl (The Satanita) [1897] AC 59 applied Dickson v Pharmaceutical Society of Great Britain [1967] Ch 708 referred to Eastham v Newcastle United Football Club Ltd [1964] Ch 413 referred to Gledhow Auto Parts Ltd v Delaney [1965] 1 WLR 1366 referred to Greig v Insole [1978] 3 All ER 449; [1978] 1 WLR 302 cited Nagle v Feilden [1966] 2 QB 633 referred to Nordenfelt v Maxim Nordenfelt Guns and Ammunition Co Limited [1894] AC 535 followed Passmore v Morland Plc [1999] 3 All ER 1005 (CA) referred to Petrofina (Great Britain) Ltd v Martin [1966] 1 Ch 146 referred to Pharmaceutical Society of Great Britain v Dickson [1970] AC 403 referred to Putsman v Taylor [1927] 1 KB 637 referred to R v General Medical Council, ex parte Colman (ex parte Colman) [1990] 1 All ER 489 referred to Shell UK Ltd v Lostock Garage Ltd [1976] 1 WLR 1187 followed Shepherd v Hills (1855) 11 Exch 55; 156 ER 743 referred to Baum Research & Dev. Co. v Hillerich & Bradsby Co., 31 F. Supp. 2d 1016 (1998) cited Brookins v International Motor Contest Association, 219 F.3d 849 (2000) referred to Boyd v U.S. Golf Association, No. Civ. 07-379-JJF, 2008 WL 2221050 (2008) cited Easton Sports, Inc. v National Collegiate Athletic Association, No. 98-2351-KHV (D. Kan., 1999) cited Gilder v PGA Tour, Inc., 936 F.2d 417 (1991) cited Gunter Harz Sports, Inc. v U.S. Tennis Association, Inc., 511 F. Supp. 1103 (1981) cited In re Baseball Bat Antitrust Litigation 75 F. Supp. 2d 1189 (1999) cited M & H Tire Co. v Hoosier Racing Tire Corp., 733 F.2d 973 (1984) cited - 4 - National Collegiate Athletic Association v Board of Regents of the University of Oklahoma, 468 U.S. 85 (1984) cited Race Tires America Inc. v Hoosier Racing Tire Corp., No. 2:07-cv-01294, 2009 WL 2998138 (2009) cited Sports Racing Services Inc. v Sports Car Club of America, 131 F.3d 874 (1997) cited STP Corp. v U.S. Auto Club, Inc., 286 F. Supp. 146 (1968) cited Super Sulky, Inc. v U.S. Trotting Association, 174 F.3d 733 (1999) cited Warrior Sports Inc. v National Collegiate Athletic Association, No. 08-14812, 2009 WL 646633 (2009) cited Weight-Rite Golf Corp. v U.S. Golf Association, 766 F. Supp. 1104 (1991) cited Windage LLC v U.S. Golf Association, No. Civ. 07-4897 ADM/AJB, 2008 WL 2622965 (2008) cited Heydon JD, The Restraint of Trade Doctrine (3rd ed, LexisNexis Butterworths, 2008) Lopatka, John E, “Antitrust and sports equipment standards: winners and whiners” Antitrust Bulletin vol 54.4 (Winter 2009) 751 Seddon, N, Government Contracts (4th ed, Federation Press, 2009) Dates of hearing: 5-9, 12-16, 19-23, 26-30 September 2011; 4-7, 10-14, 27, 28 October 2011; 30 November 2011; 15, 16, 19 December 2011 Place: Sydney Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 1611 Counsel for the Applicant: Mr AI Tonking SC with Mr JE Lazarus and Ms P Arcus Solicitor for the Applicant: Brock Partners Counsel for the First, Second Mr AJ Bannon SC with Dr RCA Higgins and Sixth Respondents: Solicitor for the First, Second Johnson Winter & Slattery and Sixth Respondents: Counsel for the Third Mr BW Walker SC with Mr GES Ng - 5 - Respondent: Solicitor for the Third Yeldham Price O’Brien Lusk Respondent: Counsel for the Fifth Mr JS Emmett Respondent: Solicitor for the Fifth Esplins Solicitors Respondent: IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 1187 of 2009 BETWEEN: BRUCE MCHUGH Applicant AND: AUSTRALIAN JOCKEY CLUB LIMITED First Respondent VICTORIA RACING CLUB LIMITED Second Respondent AUSTRALIAN RACING BOARD LIMITED Third Respondent THOROUGHBRED BREEDERS AUSTRALIA LIMITED Fifth Respondent AUSTRALIAN TURF CLUB LIMITED Sixth Respondent JUDGE: ROBERTSON J DATE OF ORDER: 19 DECEMBER 2012 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. The application be dismissed. 2. Subject to orders 3 to 5, costs be reserved. 3. The parties file and serve within 10 business days from today such written submissions (of not more than 3 pages each), if any, they propose to make in respect of costs. 4. If no such submissions are filed and served, the applicant pay the costs of the first, second and sixth respondents and of the third respondent, the fifth respondent to bear its own costs. 5. In the event that any party files and serves a written submission in respect of costs, a party affected may file and serve a reply (of not more than 3 pages) within a further 10 business days. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 1187 of 2009 BETWEEN: BRUCE MCHUGH Applicant AND: AUSTRALIAN JOCKEY CLUB LIMITED First Respondent VICTORIA RACING CLUB LIMITED Second Respondent AUSTRALIAN RACING BOARD LIMITED Third Respondent THOROUGHBRED BREEDERS AUSTRALIA LIMITED Fifth Respondent AUSTRALIAN TURF CLUB LIMITED Sixth Respondent JUDGE: ROBERTSON J DATE: 19 DECEMBER 2012 PLACE: SYDNEY - 2 - The parties .................................................................................................................. [8] Terminology................................................................................................................ [13] The impugned provisions .......................................................................................... [24] History......................................................................................................................... [32] The state